Accounting Answers

Debit Receivable

Credit Contract Liability

• What does this journal entry mean?

Debit Cash

Credit Receivable

• What does this journal entry mean?

Debit Contract Liability

Credit Revenue

• What does this journal entry mean?

Debit Contract Asset

Credit Revenue

• What does this journal entry mean?

Debit Cash

Credit Financial Liability

• What does this journal entry mean?

Debit Interest Expense

Credit Financial Liability

• What does this journal entry mean?

Debit Financial Liability

Credit Revenue

• What does this journal entry mean?

The COO (chief operating officer) of a company emphasized that any surplus amount of cash must be used to pay off previously borrowed money. In contrast, the CMO (chief marketing officer) argued that doing such would not fulfil our minimum cash balance target at the end of each month/quarter. Do you agree with CMO? Why or why not? What will be the optimum solution?

(a) You have been hired as a trainee accountant by the BDL group. and you are given the task of preparing a monthly budget for the production department. What factors will you consider in setting production requirements? Why inventories are important in production budgets?

(b) Tonwal group operates in such a dynamic environment that the top management stresses achieving the targets under all situations. What consequences of such an approach may have on Tonwal’s operations? How can the budgetary slack cause negative consequences on Tonwal’s long-term operations?

When there are implicit costs of production, then: accounting profit will be greater than economic profit.

a.

False.

b.

True.

When there are implicit costs of production, then: accounting profit will be greater than economic profit.

a.

False.

b.

True.

Assuming some idle capacity in the US economy use the following graph identify the point that present where our economy operates in 2012

Discount allowed to credit customers /debtors are recorded in which journal?

Select one:

a. Sales Journal.

b. Cash payments journal

c. Debtors’ journal.

d. Cash receipts journal

Mars Musical Instrument Company and Tiger Company engaged in the following transactions with each other during July:July 2 Mars Musical Instrument Company purchased merchandise on account with a list price of $48,000 from Tiger Company. The terms were 3/EOM, n/60, FOB shipping point. The original cost to Tiger Company was $30,000.

5 The buyer paid the freight bill on the purchase of July 2, $1,104.

6 The buyer returned damaged merchandise with an invoice price of $2,790 to the seller and received full credit. The original cost of the returned merchandise to Tiger Company was $1,700.

On the last day of the discount period, the buyer paid the seller for the merchandise.

Prepare all the necessary journal entries for the buyer and the seller using perpetual inventory method.

Zebra Corporation transfers assets with a $120,000 basis and a $250,000 FMV to Hat Corporation for common stock worth $200,000 and cash of $50,000 . The exchange qualifies as a tax- free reorganization. Zebra Corporation distributes the stock and cash to its shareholders pursuant to its liquidation. How much gain must Zebra Corporation recognize?

Unilever has forecasted purchases on account to be BDT 208000 in March, BDT 266000 in April, BDT 308000 in May, and BDT 364000 in June. 70 percent of purchases are paid for in the month of purchase, the remaining are paid in the following month. What are budgeted cash payments for April?

(b) Taba Bangladesh intends to produce special type of leather handbags for the upcoming season. The production budget for the next four months is: June 4200 units, July 7600 units, August 7000 units, September 7900 units. Each handbag requires 0.4 square meters of leather. Its leather inventory policy is 30 percent of next month's production needs. On June 1 leather inventory was expected to be 1900 square meters. Leather is expected to cost BDT 5 per square meter in June. What is the expected cost of leather purchases in June?